EUR/USD Daily Review 9 Nov 10

Good day forex trading koalas.

It is the second day of the week and i hope everyone is on the way to a great pips harvest!

In the previous review, we noted that negative German Industrial Production figures added to the depressive sentiments streaming out from the Euro Zone. While 1.3880 is a historical strong line, we noted that it is crucial to pay attention to the sentiments. Further negative sentiments may bring about more risk aversion.

Looking at the EUR/USD chart above, we can see a steady bearish momentum right down towards 1.38. The currency pair has since eased off and jumped back above 1.39.

Equities worldwide are generally positive due to the numerous big companies good earnings. This probably helped to salvage some of the negative sentiments for now.

Of interesting fact is that gold is on the move again. Koalas who bought gold when it was way low sometime back are probably happy koalas now. A number of analysts believe that risk aversion may be happening due to the apparent trouble brewing in the Euro Zone and hence the flight to safety is flowing to gold.

ECB is in talks about withdrawing emergency stimulus created during the 2008 financial crisis and investors are concerned that if this pushes through, it may be premature. Budget challenged countries like Greece may be adversely affected. Investors are also probably worried about Ireland and the outcome of the budget review.

Over in the US, investors continue to speculate if 600 billion US Dollar of quantitative easing would be useful or it will only serve to increase the massive deficit.

Among the economic data due tomorrow brings us the US Trade Balance and Unemployment Claims. Being important indicators of the US economy, watch out for unexpected moves if unexpected data is released. Furthermore, with the G20 due this weekend, apprehension will probably start to set in if not already.

Trade Safely.

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Related Forex Articles from the Koala Forex Training College.

• Quantitative Easing. What Why How
• Risk Aversion in forex
• Gold and it’s role in risk aversion
• The US Index Review / Budget Deficit Update

Read more Forex Articles and Views by The Koala at
TheGeekKnows.com – Learn Forex Trading and view EUR/USD Reviews.